Investing in your first piece of real estate is a milestone, mostly because of the amount of money you spend that comes out of your savings. It also requires a lot of “adulting”; one of which is getting a loan for the purchase of plot and construction of the house. It is honestly one of the most nerve racking and scary things for potential investors.
Applying for a loan is easy; provided you know exactly what you are doing. When approaching a bank for a loan for the purchase of plot and construction, you have two options- Land loan and Home loan.
Home loan:
- Eligibility: A property already constructed, is being constructed, or will be constructed soon, is eligible for a home loan.
- Loan To Value (LTV): It is the amount of money the bank can lend you according to the plot value. LTV for a home loan can be 75-90%.
- Long tenure: Home loans have a tenure of up to 30 years.
- Tax deductions: Tax deductions are applicable for both the principal payment and the interest.
Land loan:
- Eligibility: Loans for the purchase of commercial plots or for investment purposes come under land loans.
- LTV: LTV for land loans are lesser and stay at around 70%.
- Tenure: The tenure of a land loan is around 15 years.
- Tax deductions: Unlike home loans, land loans are not eligible for tax deductions.
Things to know before applying for a plot loan:
- Eligibility: The bank will make sure that you are eligible for the home/land loan through your credit score, income, age, and more.
- Decide on what to do with the land: A huge residential project like Mantri KNS Carica has residential plots that can be used for both investment and housing needs. Select an appropriate plan.
- Loan amount and EMI: Decide on the loan amount you require and discuss the EMI options along with the tenure.
- Documents required: Documents that prove your identity, financial status, and property documents are crucial. Title deed, agreement to sell and more have to be received from the original owner which can be a hassle. Choosing a developer like Mantri KNS Carica will leave you with a worry-free experience.
When it comes to buying a residential plot, choosing Mantri KNS Carica project is the smartest option for the smart investor in you. The project is located in Kengeri, off Mysore Road. You can get loans for purchase of plots and for construction from top banks and make your dream home a reality!